Comeback … Harmony Korine is now welcome on David Letterman's talk show. Photograph: Matt Baron/BEI/Rex Features

US talkshow host David Letterman has revealed he banned director Harmony Korine from The Late Show after finding him going through Meryl Streep's purse backstage.

Korine appeared on Letterman in the late 90s, a period during which he was using crack and heroin and which saw two of his homes burn down in mysterious circumstances. The film-maker, who looks set to have the biggest hit of his career with the comedy thriller Spring Breakers, is now clean.

Korine's friend, and the star of Spring Breakers, James Franco, appeared on Letterman on Monday night and asked the comic to finally reveal why the film-maker, whose trio of stumbling, half-cut appearances on The Late Show are legendary, had been asked not to return. The actor revealed his friend had told him he was banned for pushing Streep backstage, adding: "Harmony is a very sane guy now, a great artist and great person to work with, but I think he had a period where he was going a little off the rails, so maybe he was on something that night."

Letterman then revealed the true story behind the incident in public for the first time. "I went upstairs to greet Meryl Streep and welcome her to the show, and I knock on the door … and she was not in there," he said. "And I looked around, and she was not in there, and I found Harmony going through her purse. True story. And so I said: 'That's it, put her things back in her bag and then get out.'"

Letterman said he would now be happy to have the director, who completed rehab more than a decade ago, back on his show. Korine, who wrote the controversial film Kids for director Larry Clark at the age of 19, has described the period as a "crazy time" that he could not live through again. "I felt pretty debased and lost," he told the Guardian in 2008. "I became like a tramp. I wasn't delusional. I didn't think I was going to be OK. I thought: 'This might be the end.' I'd read enough books. I knew where this story ended. The story finishes itself."

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